China’s second-hand home sales begin to rise faster than new homes in some cities

(Yicai Global) Aug 31 — Second-hand apartment sales in China have risen for three straight weeks this month, outpacing sales of new properties in some places as local governments begin to put more emphasis on the pre owned market and as credit eases.

Some 14,859 second-hand units changed hands in 10 Chinese cities last week, up 2.3 percent from the previous week, according to data research center Zhuge. During the same period, 23,189 new apartments were moved in 15 municipalities, representing a weekly gain of 0.4%.

A number of cities introduced favorable real estate policies in the second quarter targeting occupied apartments first, said Xu Tao, chief financial officer of real estate transactions and services platform KE Holdings. Overall, many customers who took a wait-and-see approach are now starting to enter the market.

Chengdu, the capital of southwestern Sichuan province, led the way with second-hand apartment sales in July hitting a nearly 10-year high of 17,296 units, said Ding Zuyu, chief executive of E-House China real estate agency. 25, citing data from China Real Estate Information Corp.

Sales of second-hand apartments in Chengdu have been on the rise since March, when they surpassed those of new apartments, at 13,858 units, Ding said. Last month, second-hand homes accounted for 54% of the total area sold, compared to 37% in January.

More and more people are choosing to buy new completed apartments or second-hand apartments after highly indebted developers recently struggled to get properties back under construction on time. Nowadays, people who opt for pre-sales prefer to choose projects from public developers, a staff member of one such company told Yicai Global.

Many Chinese cities have also dropped publication of indicative prices for second-hand homes. In February, 15 cities gave indicative prices, of which only two still do.

But some players in the sector believe that the second-hand property market continues to recover as prices remain fluctuating, despite the increase in the volume of transactions in some cities.

Editors: Shi Yi, Kim Taylor